Benjamin Netanyahu would like Americans and Israelis to believe that it’s 1938 all over again: Iran, he tells us, is Nazi Germany; President Mahmoud Ahmadinejad is Hitler. And, of course, that means that anyone who advocates diplomacy and engagement with Tehran is simply reprising the tragic appeasement politics of Neville Chamberlain, even as the clock ticks towards catastrophe.

The 1938 analogy is entirely fallacious, but no less powerful because of it – by at once terrifying people and negating the alternatives to confrontation, it paints war as a necessary evil forced on the West by a foe as deranged and implacable as Hitler was.

If Iran is, as Netanyahu and his allies in the U.S. suggest, irrationally aggressive, prone to a suicidal desire for apocalyptic confrontation, then both diplomacy and deterrence and containment are ruled out as policy options for Washington. The “Mad Mullahs,” as the neocons call them, are not capable of traditional balance of power realism. In the arguments of Netanyahu and such fellow travelers as Norman Podhortez and Newt Gingrich, to imagine that war against the regime in Tehran is avoidable is to be as naïve as Chamberlain was in 1938.

However, as I discovered in the course of researching my book Treacherous Alliance – the Secret Dealings of Israel, Iran and the United States, not only does Netanyahu’s characterization of Iran have little relationship to reality; Netanyahu himself knows this better than most. Outside of the realm of cynical posturing by politicians, most Israeli strategists recognize that Iran represents a strategic challenge to the favorable balance of power enjoyed by Israel and the U.S. in the Middle East over the past 15 years, but it is no existential threat to the Israel, the U.S. or the Arab regimes.

And that was the view embraced by the Likud leader himself during his last term as prime minister of Israel. In the course of dozens of interviews with key players in the Israeli strategic establishment, a fascinating picture emerged of Netanyahu strongly pushing back against the orthodoxy of his Labor Party predecessors, Yitzhak Rabin and Shimon Peres, which treated Iran as one of Israel’s primary enemies. Not only that, he initiated an extensive discreet program of reaching out to the Islamic Republic.

When he took office in June of 1996, the U.S.-educated Likud leader
sought not only to undo the peace process with the PLO and the
land-for-peace formula; he also sought a return to Israel’s
longstanding strategic doctrine of the periphery – the idea that the
Jewish State’s security was best achieved by forming secret or
not-so-secret alliances with the non-Arab states in the periphery of
the Middle East – primarily Turkey and Iran – in order to balance the
Arabs in Israel’s vicinity.

Such a shift required efforts to undo Shimon Peres and Yitzhak Rabin’s
rhetoric on Iran – deemed “exaggerated and self-defeating” by many in
Israel at the time - as well as attempts to quietly reach out to
Tehran. [1]
Unlike his Labor predecessors, Netanyahu chose to follow the
recommendations of an internal Israeli government report on how to
address the Iranian challenge, which had concluded that Labor’s
inflammatory rhetoric had only attracted Iran’s attention and
strengthened Iran’s perception of an Israeli threat, which in turn had
made Israel less rather than more secure. [2]
(Even though Israeli intelligence discovered the existence of an
Iranian missile program in late 1994, there was widespread recognition
in Israel that Iran’s rearming, its missile program and even its
potential nuclear program were not aimed at Israel.[3] )

One of Netanyahu’s first orders of business as Prime Minister was to
request an intelligence assessment of Israel’s security environment
from both the Mossad and the military intelligence. The debate between
these agencies was the same as in the 1980s – did Iran or Iraq
constitute the greatest threat to Israel? And could Iran be relied upon
to balance Iraq?

The assessments were presented at a full cabinet meeting. Major General
Amos Gilad represented the military and Uzi Arad, the Director of
Intelligence of the Mossad, argued on behalf of the intelligence
services. While the debate was heated and passionate – as all cabinet
discussions were in the Netanyahu government – the outcome was
unprecedented.

Gilad argued that Iran had replaced Iraq as an existential threat to
Israel. First, the Iranian regime was hostile to Israel and determined
to destroy the Jewish State. Gilad dismissed the notion that moderates
would get the upper hand in Iran and argued for the opposite scenario.
“I presented a tough line that claimed that Iran would be dominated by
the conservatives.… This was at the level of strategic intentions,” the
Major General explained to me.

Second, the Iranian capabilities had grown, particularly through
Tehran’s missile program. Gilad asserted that the Iranians would have
Israel within reach of their missiles by 1999. The third component was
Iran’s nuclear development program. “Even one primitive device is
enough to destroy Israel,” Gilad maintained. “Altogether, it seemed
that ideologically and strategically, Iran [was] determined to destroy
Israel,” Gilad concluded. [4]

Arad presented a radically different perspective. He argued that Iran’s
rearmament was defensive and primarily aimed at deterring Saddam
Hussein. Iran needed to rearm due to the natural continuation of its
enmity with the Arab states; after all, Iran and Iraq had yet to sign a
conclusive peace treaty.

Furthermore, Iran was in debt, the internal political situation was
unstable, and oil prices were low. All of this reduced Iran’s ability
to pose a threat, Arad argued, whereas Iraq – with its existing Scud
missiles, of which 39 had been fired at Israel during the Persian Gulf
War – was a proven danger. [5]

In fact, the Arabs’ perception of Iran as a threat could give life to
the periphery doctrine again, leading to an Israeli-Iranian
re-alignment to counter the common Arab threat.

The heart of Arad’s argument was that Israel had a choice: it could
either make itself Iran’s prime enemy by continuing Peres and Rabin’s
belligerent rhetoric, or it could ease off the pressure and allow the
Iranians to feel a greater threat from other regional actors. (At the
time, Iran had the hated Saddam regime to the West and a mortal enemy
in the Taliban to the East, the latter together with Pakistan both
being clients of the Saudi regime that had backed Saddam in his war
against Iran.)

“There are enough bad guys around them; we don’t have to single out ourselves as the enemy,” went Arad’s argument.[6]
Israel should remain cautious and pursue a policy of wait and see
whether Iran’s ambitions went beyond its legitimate defense needs. [7]

Most importantly, Israel should avoid continuing the pattern of
rhetorical escalation with Iran that had characterized the stance of
the previous two Labor governments. “We needed to tone down,” said
Shlomo Brom, who was a member of the original Iran committee. [8]

Netanyahu listened carefully as the two sides fought it out. Gilad
spoke with great confidence, knowing very well that no Prime Minister
had ever dismissed the findings of the military’s National Intelligence
Assessment. And with the Israeli tendency to embrace doomsday scenarios
and treat nuanced and slightly optimistic assessments with great
suspicion, the odds were on his side.

But Netanyahu’s response left Gilad baffled. In an unprecedented move,
the Prime Minister rejected the National Intelligence Assessment and
instead adopted Arad’s recommendation of reducing tensions with Iran. [9]
Much to Gilad’s frustration, Netanyahu focused on Arafat and the
Palestinian threat instead of Iran and put a complete end to Israel’s
confrontational rhetoric against Tehran. It was a major policy shift
that affected all levels of Israel’s planning vis-à-vis Iran. “Until
the Netanyahu government, there was a proliferation of Israeli
statements trying to deter Iran, warning Iran, the long arm of the
Israeli air force etc. That was stopped, to his credit, by Netanyahu,”
Ehud Yaari of Israel’s Channel 2 explains. [10]

Israeli media sympathetic to the Likud government’s shift on Iran
argued that the previous Labor government was to blame for the
escalation with Iran, citing the efforts of Uri Lubrani, Israel’s
former head of mission to Iran during the 1970s, to convince the
Clinton Administration to finance a coup d’état in Iran in the early
1990s. The publication of the Labor initiative had “caused huge damage
to Israel,” unnamed Israeli intelligence officials told Israel’s
Channel 2.

The Netanyahu government viewed these statements as counterproductive
and sought to avoid such entanglement with the Iranians. “He
[Netanyahu] didn’t want to use rhetoric that would just antagonize them
[the Iranians] for no reason,” Dore Gold, foreign policy advisor to
Netanyahu and Israel’s UN Ambassador explains. [11]

But Netanyahu went beyond just lowering the rhetoric. He tried to reach
an understanding with Iran though the help of prominent Iranian Jews[12], he stopped Israeli attacks on Iran within international organizations[13], he arranged for meetings between Iranian and Israeli representatives at European think tanks[14], and he encouraged Israeli parliamentarians to reach out to their
Iranian counterparts at meetings of the Inter-Parliamentarian Union. At
one point, he even sought Kazakh and Russian mediation between Iran and
Israel. In December 1996, Kazakhstan’soil minister, Nurlen Balgimbaev,
who enjoyed excellent ties with Tehran, visited Israel for medical
treatment and was approached about arranging a dialogue with Iran to
discuss ways to reduce tensions between the two countries. [15]

None of his efforts bore any fruit, though. Iran’s dismissal of
Israel’s conciliatory signals convinced the Netanyahu government that
just like in the Iran Contra affair, Tehran only wanted to mend fences
with the U.S. and had no real interest in rebuilding its ties with
Israel.

Therein, of course, lay the real threat from Iran.

The Israelis saw danger in a rapprochement between Tehran and
Washington, believing this would inevitably see the U.S. sacrifice some
of its support for Israel in order to find a larger accommodation with
Iran, in pursuit of U.S. strategic interests in the Persian Gulf and
the Caspian Sea. Iran would become emboldened and the U.S. would no
longer seek to contain its growth. The balance of power would shift
from Israel towards Iran and the Jewish State would no longer be able
rely on Washington to control Tehran. “The Great Satan will make up
with Iran and forget about Israel,” Gerald Steinberg of Bar Ilan
University in Israel noted. [16]
Israel’s relative regional importance to the U.S. would decline with a warming of ties between Washington and Tehran.

So, after nine months of courting Tehran, Netanyahu gave up and
reverted back to the Peres-Rabin policy of vilifying Iran and seeking
its international isolation.

Today, Israel is facing a similar situation, but with one big
difference. Iran is far more powerful than it was in 1996, while the
power of the U.S. to impose its will in the Middle East has diminished
considerably. The difficulties confronting the U.S. in Iraq and
technological progress in Iran’s nuclear program may compel Washington
to recognize that its best interests lie in a grand bargain with
Tehran. But the general view in Israel today is the notion that such
negotiations must be prevented, because all potential outcomes of a
U.S.-Iran negotiation are perceived to be less optimal for Israel than
the status quo of intense U.S.-Iran enmity that threatens to boil over
into a military clash.

It’s precisely to prevent such engagement between Washington and Tehran
that Netanyahu and company are pressing the 1938 analogy.

(In Treacherous Alliance,
I explain how Israel’s fear of a U.S.-Iran dialogue is misplaced and
that it actually is through a U.S.-Iran rapprochement that the Jewish
state best can secure its interest and change Iran’s aggressive
behavior towards Israel.)